Project Overview

This project examines New Zealand’s relationship property legislation. When it was enacted, the Property (Relationships) Act 1976 was seen as a significant and long-awaited step in the development of relationship property law in New Zealand. It sets out the rules for how the property of two partners is divided when they separate or when one of them dies. Subsequently, a set of important amendments were made to the Act in 2001, including its extension to de facto relationships. The underpinning principle of the Act is that “relationship property” as defined by the Act should be divided equally between the two partners upon their separation.

Terms of Reference

The Property (Relationships) Act 1976 (“the Act”) created a code which governs the division of property held by married couples, civil union couples and couples who have lived in a de facto relationship when they separate or one of them dies.

The Act was amended in 2001 and 2005 to extend its application to civil unions and defacto partnerships but has not been comprehensively reviewed since its inception. Over time the Act affects almost every New Zealander, both adults and children, and as such it should be reviewed to ensure that it is operating appropriately and effectively.

The Law Commission’s review of the Act will include (but not be limited to) the following matters:

The definitions of property, relationship property, and separate property;

How a de facto relationship is defined for the purposes of the Act;

Differences in the rules governing de facto relationships and marriages/civil unions;

Whether the Act gives rise to matters of particular concern to Māori and how these should be addressed;

How the interests of children are recognised and protected under the Act and in how it is applied;

How the Act functions in relation to sequential relationships and blended families;

The ability to make adjustments to take account of economic disparity between spouses and partners, and other departures from equal sharing as contemplated by the Act;

The operation of Part 5 of the Act concerning relationship property and creditors;

How the Act deals with property held by a company or trust and the powers of the courts in this area;

The relationship between and application of the Act and section 182 of the Family Proceedings Act 1980;

The provisions relating to contracting out and settlement agreements;

The provisions relating to division of property on death;

The requirements for disclosure of information in relationship property matters and the consequences for failing to disclose;

The jurisdiction of the courts over relationship property matters and the range of orders the courts can make;

Whether the Act adequately deals with cross-border issues;

Whether the Act facilitates the resolution of relationship property matters in accordance with the reasonable expectations of the parties.

The Law Commission will consult with experts, stakeholders, and the general public over 2016 and 2017. The Commission will report to the Minister with its recommendations by November 2018.

Issues Paper

The Property (Relationships) Act 1976 (PRA) is a crucial part of New Zealand’s social legislation. It contains the rules for the division of property when a relationship ends as a result of separation or on the death of one of the partners.

The PRA is, however, now over 40 years old and is in need of review.

In this review, the Law Commission asks whether the existing rules in the PRA are still achieving a just division of property at the end of a relationship.

When first enacted in 1976, the PRA challenged and helped redefine the role of women in society. When it was amended in 2001, the PRA sought fair treatment for different relationship types by extending its application to de facto relationships and same-sex relationships. The PRA has both reflected and shaped societal values in the way people enter, conduct and leave relationships.

Yet we know that New Zealand in 2017 looks very different to New Zealand in 1976, and even 2001.

Our Study Paper, Relationships and Families in Contemporary New Zealand: He honongatangata, he hononga whānau i Aotearoa o nāianei, confirms that the changes have been dramatic.

For example, in 1976 the marriage rate was 35 per 1,000 unmarried adults yet by 2016 that rate had dropped to 11. Children are now ten times more likely to identify with more than one ethnicity than older New Zealanders.

There have also been some broad changes to New Zealand law over the last 40 years.

A more child-centred approach, particularly in the family law context, is well-established. New Zealand law has increasingly sought to recognise tikanga Māori.

Human rights law has developed and plays an important role in our legal framework.

The courts have responded to New Zealanders’ widespread use of trusts by developing remedies to recover property held on trust.

All of these developments are relevant to the legal context in which the PRA operates.